EIM strikes payment errors

Vendors are forging incentive wares that put the reins of compensation firmly in executives’ hands.

Best-of-breed EIM (enterprise incentive management) players Motiva, Callidus Software, and Centive are casting their products to link more easily with CRM, SCM (supply-chain management), and payroll systems and are utilizing portal and dashboard technology to bring crucial incentive data to light. Meanwhile, vendors such as PeopleSoft and Oracle are offering similar incentive-oriented products that link more easily to enterprise apps.

Both breeds seek to align employee behavior with strategic business goals.

Motiva this month will unveil Motiva 9, the newest version of its EIM suite. Version 9 will feature advanced incentive-plan modeling, data-visualization capabilities, and embedded workflow technology and will be wired for Web services to provide access to external data and applications.

Web services interfaces are critical for companies to seamlessly link to payroll, HR, or CRM systems without having to hard-code integration between apps, said Jeff Carr, chairman and CEO of Pleasanton, Calif.-based Motiva. The company’s new suite will also provide role-based dashboard overlays that will allow executives to monitor performance against budget expenditures and estimates and to make necessary adjustments, Carr added.

Previously deployed as replacements for sales-commissions spreadsheets, EIM solutions now allow executives to model potential compensation scenarios to measure their impact on the bottom line. The solutions can be used to link factors such as customer satisfaction to employee pay scales or bonuses and allow executives to quickly tweak incentive plans to spark a company’s sales force to focus on a particular product.

“[Enterprises] can make some quick decisions about how to move more product out the door … and [can] design compensation plans and roll them out to the field,” said Monica Barron, research director at Boston-based AMR Research. “You can really start people talking about new products today as opposed to waiting weeks and weeks to roll out the compensation plan.”

By automating compensation calculations and linking directly to payroll systems, EIM technology can help eliminate commission overpayments, which range between 8 percent and 10 percent at companies that use manual systems, Barron added.

“If you are looking at any sizable sales organization, you are talking about millions of dollars a year [in overpayments],” Barron said. “Companies have decided to eat it until now.”

First Tennessee Bank is utilizing Motiva’sEIM suite at 5,000 locations to help executives drill deeper into sales-compensation data, noting, for example, the average daily balance in deposit accounts, not just the number of new accounts a representative has sold, said Randall Carrier, senior vice president and manager of sales and services at the Memphis, Tenn.-based company.

“It gives us the ability to drill in to see where the trouble areas are … and decide, Do you want to start a special campaign, or do we re-evaluate if this was a realistic goal for that particular location?” Carrier said.

Callidus Software in February rolled out TruPerformance 1.5, which is designed to extend EIM across the enterprise by aligning compensation plans with sales, finance, accounting, and HR objectives.

PeopleSoft’s EIM offering makes use of the company’s AppConnect integration brokers to allow enterprises to pull data from PeopleSoft systems or other enterprise apps to build an end-to-end incentive process that allows executives to adjust compensation to mirror changing business conditions, said Jason Averbook, director of global product marketing for human capital management at Pleasanton, Calif.-based PeopleSoft.

“If you can’t pay this reward out, it doesn’t do any good to calculate, [and] if you are cutting into your cost savings by building interfaces to your payroll system, that doesn’t help with costs,” Averbook said.

PeopleSoft in December rolled out EIM vertical solutions for high-tech and manufacturing companies and will release a banking and financial services solution by the end of the year.